- The amount of stolen bitcoin has dropped 92% from last year, according to Casa CTO Jameson Lopp
- Just 4,437 bitcoin was stolen last year, an all time low
- Better exchange security and aa shift to DeFi theft has helped bring the number of stolen bitcoin down so much
The amount of stolen bitcoin in 2020 represents an all-time low according to Jameson Lopp, CTO at Casa, with a staggering 92% reduction compared to 2019. Lopp released an update to records he has been keeping since 2014 to reflect the amount of bitcoin reported stolen through hacks, viruses, or other nefarious means, and found that 4,473 BTC was reported stolen in 2020 compared to 54,570 in 2019. The huge reduction is thought to be down to an increase in cryptocurrency exchange security and a shift from hackers to DeFi projects which are easier to hack.
Bitcoin security appears to be improving! As far as I can tell, only 4,366 BTC was stolen in major publicly announced thefts during 2020. This is a 92% drop from 2019 and an all-time low of only 0.02% of the total supply.
— Jameson Lopp (@lopp) December 29, 2020
Stolen Bitcoin Down 92% Year in Year
Lopp posted his update at the end of 2020 alongside and explanation of how he defines ‘stolen’:
I’d say stolen is: one day you go to check your wallet and the funds aren’t there. I’d count viruses that steal private keys (as stolen)…
Lopp admitted that his analysis was far from comprehensive, adding that “as far as I can tell” 2020 has been the best year by some margin for bitcoin theft. The 2020 total of 4,473 stolen bitcoin is not only a 92% drop from 2019, the year in which Binance was hacked for 7,000 BTC, but was a country mile from 2014, where 678,262 BTC was stolen, although 650,000 of this was down to the hack on Mt. Gox.
Better Exchange Security and DeFi Pivot Brings Down Numbers
Several factors account for this huge year on year reduction in bitcoin theft. Firstly, cryptocurrency exchanges are the most secure they have ever been, with protocols in place to recover or otherwise limit the usage of stolen funds. Secondly, there is much more awareness within the community, and with newcomers, about the importance of personal security and how to go about securing your bitcoin.
It must also be noted, as CipherTrace reported in November, that crypto criminals have pivoted to DeFi protocols as they are easier to hack than centralized exchanges, which naturally tilts the balance from stolen bitcoin to ETH and other tokens native to DeFi platforms.